Why that home insurance calculator doesn’t show the whole picture

Home insurance calculators in Canada are all the rage these days because they save time, but they’re also notoriously inaccurate. We’re not suggesting you should have to wait on the phone for half an hour, of course (you can get an accurate quote right here in 3 minutes instead), but they’re often guilty of accounting for location and a few loose questions.

While location is important, it’s not the only factor in determining your rate. You’d also need to count your personal insurance history to get a truly accurate quote (among other things), leaving that generic home insurance calculator for Canada unable to help you budget properly.

What else do you need for an accurate quote?

Let’s start with a reminder on what home insurance is and how companies calculate coverage. The idea is to ensure that should something unexpected occur, like a house fire or flood, then your home and belongings will be restored to the state or value that they held before whatever happened. The purpose of a home insurance calculator is to help your insurance company determine the cost to rebuild and/or repair your property in the event of such an incident.

Start with these terms about home insurance to get an idea of how brokers calculate home coverage. With those in mind, your home insurance coverage will be affected by:

  1. Age
  2. Building Codes
  3. Recent Renovations
  4. Custom Windows
  5. Cleanup Costs (after storms or disasters)
  6. Contents Coverage
  7. Foundation quality
  8. Roof Condition
  9. Water Damage
  10. Electrical Fixtures and Wiring
  11. Plumbing and Pipes
  12. Heating and Cooling Systems
  13. Solar Panels (or alternative energy sources)
  14. Presence of Pets

You can get a deeper sense of how home insurance is calculated here. Keep in mind that your own insurance history will play a significant role as well.

Example questions for a home insurance calculator

Home insurance calculators are helpful, but they’re not always reliable, especially if they’re not connected to a regulated insurance carrier. The process typically entails asking a series of questions about the exterior and interior of your home’s construction in addition to your location.

Examples of exterior questions include:

  1. Is your home constructed of solid brick, brick veneer, vinyl siding, or something else?
  2. What’s the construction of your roof (asphalt, clay, etc.)?

Examples of interior questions include:

  1. What type of flooring do you have throughout your home (carpet, hardwood, ceramic tile, etc.)?
  2. How many bathrooms do you have?
  3. Is your basement finished?

Once you’ve answered all of the questions pertaining to your home, the home insurance calculator for Canada will work it’s magic and come up with an amount for your home. What’s important to keep in mind is that these calculators don’t know what they don’t know.

This means you should pay particular attention to some of the values that are being calculated if they do not appear to align with work that you’ve done on your home. New home owners are at particular risk of finding an unpleasant surprise, as they don’t always have previous house insurance experience that prompts them to shop around for comparisons and second opinions.

Also, you should make your insurance company aware of any additional items or features that may not have been asked. This could include:

  1. Skylights
  2. Specialty bay windows
  3. Home theatres
  4. New counter tops

A home insurance calculator is a tool that certainly helps insurance companies determine the costs associated with rebuilding or repairing your home, but ultimately know that you will always know your home better than any calculator will.

Also remember that as you continue to live and enjoy your home by adding your personal touches, you should contact your insurance company to make sure you always have the coverage you need.

Seriously, what else can you do in 3 minutes?

Boil half an egg?

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